The radio show with Jason has been awesome and since then there are a lot of people (friends included) who have finally decided to try to give this a go. Obviously, when you start you want to avoid a few things that will deter you from even starting.

1. Spending hours upon hour on YouTube2. Start without knowing how to do this and end up losing money

That being said here are 5 steps that I would suggest to anyone to get started.

1. Sign up for the Shark Pack:

You get access to 1 Beginners Webcast where we cover the questions to help you get started. Second, you get access to two long lessons on Options & Futures with two live trade videos with real money. Sign up here, it's free.

BTW, try to schedule to attend one of them, it takes an hour to do and it's easier then trying to plan that business idea you've been working on for the last two years.

2. Learn the basics of options (calls and puts):

This is important. Don't get sucked into the other strategies when you start. They're confusing. Just learn the basics; What is a call? What are strikes? We have that information here for you on this page. But you can search too.

3. Start reading about candle stick charts:

Don't buy a book. Google it and read a few articles. The idea here is to get you familiar with the lingo, don't worry if it's not clear, just start surrounding yourself with some basic terms. This is like learning a new language...so learn the basic phrases.

4. Open a Think or Swim Account:

You can get a demo account with them so you can start practicing. This takes ten minutes. Also, download the iPhone app for it (Choose the Think or Swim One).

5. Follow our YouTube

We put out videos periodically. They're free and are usually less than 10 minutes. Of course it will make no sense but just keep watching them for a while and they will.

Finally, when you're ready you can take a course. This is a process, expect to put in 5-10 hours a week for the next 3 months. Yes, true, it's not 'passive' like real estate but then again you don't need tens of thousands to do this as you do in real estate and second, you can start without having tenants or worrying about things breaking at properties.

This is not a full time thing for most, don't expect it to be, but expect to create an additional stream of cash flow for part time work.

Three weeks ago we had our Option Strategies class and a week before that Ryan held a webcast on earnings season trading. It paid off. This week Amazon reported, and initially, we had no insight to how to trade it. In fact, we broke the rules trading it the day before but how do you know when you can break them?

It's Risk Management.

Trading is like running a business, in fact, it is a business. I'd venture to say that before taking any trading class most should read a book on business basics. When we trade earnings it's usually a week ahead of the event so that we can structure our trades ahead of time in anticipation of the event. What most do is buy calls or puts the day before then close their eyes and do the hope and pray strategy: Hoping and praying it goes your direction.

​

Yesterday a few of the students did this, however, it was risk managed trading. How? They were up on the week and had capital to use. The reward (the upside of the move) justified the cost of the call options. At worst they would still be profitable on the trading week. This is something George Soros did when he "Broke the Bank of England" making over $1B in the process. He risked capital that they had already made on the year to make this trade. ​

Trading the Right Stocks.

It start's with trading the right stocks. We use a set of 50 stocks and ETF's in our Core Foundations of Trading program that students track and follow and it just so happens that Amazon is one of those. Four times a year we get earnings and usually, you get large, outsized moves on them because of how they report on earnings. So those situations create opportunity to make a lot of money. Be it pre-earnings or post earnings (we teach both in Option Strategies).

Do these moves miss at times? Yes, I have taken trades where I had a great PTA for a long only to see the stock go the opposite way. Does it bother me to lose money? Sure, but we're managing risk here, not the emotions on each trade. So when you look at the set up you have to justify A) If you have enough capital to do this and B) If the reward justifies the risk.

For me, this is why I like options as an additive to portfolios. I despise Forex but love futures. Options give you the opportunity to 'knock it out of the park' like this where other asset classes are usually standard moves.

Do the Math.

If we're talking risk/reward here let's do some math. How do most stock day traders trade? I've done this 10 + years now, I've seen every prop firm, strategy, indicator you can think of. So let me show you how 99% of stock day traders trade then fail, every time.

Trader has $5,000 in their account, they use margin to get them to $10,000. Trader buys $6,000 worth of XYZ stock at $5.50.

That's 1000 shares. Trader puts a stop at $5.30 for risk of $200. The stop is typically 'too tight' and stops them out. Why is the stop too tight? Because they're too levered, too many shares to make too small of a gain. So what happens? They take 5-10 trades a day for small penny gains.

Let's take Cory's example on the Amazon options trade above.

Cory buys 1 AMZN Call for $280. If Amazon went lower his max loss is $280, but his gain was over $2,000. So there's a few things here to take note of. One, the risk is minimal. Second, and arguably most important, he's not nail biting watching a 1 minute chart hoping it goes in his direction because his risk is defined.

If you want to know why there are so many schools out there that promote stock day trading it's simple: Day trades like that are a brokers dream. More trades = more commissions. This is the same conflict of interest financial advisors have with clients for money management.

Crude Oil: If we look at the most recent posts on this market we've tracked the moves incredibly well. Heading into tomorrow we look for support and reversal into the end of the week. As always EIA reports on Wednesday are an event traders watch as it brings volatility.

S&P E-Mini: A nice run on the index but we did not get a signal worth taking. At this point we are simply awaiting an outside day reversal.

Trading Futures, Options on Futures, and retail off-exchange foreign currency transactions involves substantial risk of loss and is not suitable for all investors. Past Performance is not indicative of future results. With regard to any testimonials posted on this site, please note that any references to performance depends on each individual’s unique skills, time commitment effort and capital. Individuals sharing their results have not been compensated and any results have not been independently verified. Results may not be typical and individual results may vary.﻿